Anfield Session Week Report March 16-20

Budget

This week, after receiving allocations from their presiding officers, the House and Senate subcommittees released the “Chairman’s” budget proposals for the upcoming fiscal year. There are significant differences between the chambers with regard to the total funds dedicated to agriculture and natural resource management agencies. With respect to key environmental program and initiatives, the Chair’s allocations are as follows:

Program House Senate____________________________________________________________________________Florida Forever / Land Acquisition $205,000,000 $ 22,000,000Everglades Restoration $100,000,000 $ 79,000,000Everglades Restoration (Incl. IRL) $ 33,000,000 $ 0Northern Everglades, WQ & Estuaries Projects $ 20,167,551 $ 3,000,000Springs Protection $ 55,215,853 $ 50,000,000Alternative Water Supply $ 50,000,000 $ 50,000,000Drinking Water State Revolving Loan Program $ 95,863,107 $ 88,422,307Wastewater Revolving Loan Program $191,128,531 $181,210,531Small County Wastewater Treatment Grants $ 16,000,000 $ 16,000,000Total Maximum Daily Loads $ 9,385,000 $ 9,385,000DACS “Water Farming” Lake O. Basin $ 7,000,000 $ 0DACS BMP’s Implementation $ 5,500,000 $ 1,900,000DACS Hybrid Wetland Treatment Program $ 6,200,000 $ 0Non-point Source Management $ 17,300,000 $ 3,000,000Keys Wastewater Treatment $ 25,000,000 $ 0Beach Restoration $ 40,000,000 $ 25,000,000Petroleum Tank Clean-up $110,000,000 $110,000,000Dry Cleaning Solvent Clean-up $ 6,500,000 $ 6,500,000Local Water Projects $ 80,589,000 $ 0Transfer to DOT for Trails $ 0 $ 25,000,000

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As summarized below, with respect to funds associated with the Land Acquisition and Management Trust Fund (Amendment 1), the chambers took different approaches towards the expenditure of the funds.

Agency House Senate ______

Dept. of Agriculture and Consumer Services $125,104,703 $ 89,525,015Department of Environmental Protection $505,316,871 $504,006,631Fish and Wildlife Commission $ 98,975,597 $120,662,794Total $729,397,171 $714,154,400

Next week (4th week) both chambers will consider and amend these proposals in the full appropriations committees prior to floor action. Once each chamber approves their versions of the State budget they will be in a posture to commence budget conference (reconcile the difference) as soon as the presiding officers agree on allocations within each area of the budget. This is not anticipated to happen until week 7 at the earliest.

Hazardous Walking Conditions (CS/CS/SB 154 & CS/HB 41)

Background: Each district school superintendent is responsible for determining which students require busing directly to & from the school and for making recommendations to the district school board regarding transportation plans and procedures, including the routing and scheduling of school buses. Students in grades 6 and below, students who live more than two miles from the school, or students who face hazardous walking conditions on the way to school must be provided with transportation by the district board.

Under the current definitions in statute, in order for a school route parallel to a road to be classified as a “hazardous walking condition”, it must meet one of the following criteria:

1. Sidewalks or non-road medium parallel to road are less than 4 feet wide, or

2. The road is uncurbed, the posted speed limit is at least 55 miles per hour, and the walking surface is less than three feet from the road surface.

The definitions specifically exclude roads that go through residential areas that have little vehicular traffic (less than 180 vehicles going in either direction) during the hours when students are walking to school, and which have a posted speed limit of 30 MPH or less.

For a route that crosses a busy section of road to be defined as a hazardous walking condition, the total traffic volume must exceed 360 vehicles per hour, per direction, during the opening and closing school hours, and cuts through an “uncontrolled” crossing point, or, the total hourly traffic must exceed 4,000 vehicles per hour and cut through an intersection controlled by a stop sign or traffic light (the exception being crossing lanes that are supervised by a crossing guard or traffic officer during opening and closing school hours.)

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Requests for a review of the local walking conditions must be made to the district school super-intendant and performed by a representative of both the school district and the local government. Once the school district and the local government have come to a mutual agreement that a hazardous walking condition exists, the district superintendent may file a report with the Department of Education (DOE) and request that the local government determine whether they will correct the hazardous condition and if so, provide a predetermined completion date.

Proposed Changes: This bill:

Requires district school boards and other governmental entities to cooperate to identify hazardous walking conditions;

Requires the entity with jurisdiction over the road to correct the hazardous condition within a reasonable time;

Requires the entity with jurisdiction over the road to include correction of a hazardous condition in its next annual 5-year capital improvements program or provide a statement of the factors justifying why a correction is not so included;

Revises the criteria identifying hazardous walking conditions for walkways parallel to the road;

Creates a new hazardous walking condition category, “crossings over the road”; Requires additional parties to participate with the representatives of the school district

and entity with jurisdiction over the road in inspecting the walking condition and determining whether it is hazardous;

Provides the district school board, after notice, may initiate a declaratory judgment proceeding if the local governmental entities cannot agree whether the condition is hazardous; and

Provides a hazardous walking condition determination may not be used as evidence in a civil action for damages against a governmental entity.

The defined conditions would in turn be amended to be more expansive. For walkways parallel to roads, the exception for roads in residential areas would be removed; the posted speed limit threshold reduced from 55 to 50 miles per hour; and ditches, sluiceways, swales, or channels would no longer be considered walkable surfaces.

Routes through intersections and crossing points that are “uncontrolled” would be considered to have a hazardous walking condition if the road the route crosses has a posted speed limit of 50 or higher; or has six lanes or more (not including turning lanes), regardless of the speed limit.

Requests to identify a hazardous walking condition must be made to the school superintendent and the superintendent in turn must request a review of the school district’s walking conditions be made jointly with the proper local government agency (for municipal roads, the municipal police department; for county roads, the sheriff’s department; for state roads, the DOT). Upon completion of the review, it is ultimately up to local government entity to report in writing their determination to both the DOE and the school, regardless of whether they are in mutual agreement. If they are not, the local government must give specific reasons why they have

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determined no hazardous walking condition exists or why removal of the condition is not possible. Subsequently, the superintendent must provide a report and recommendation to the district school board regarding the lack of consensus.

Under these circumstances, the bill authorizes a district school board to initiate a proceeding under ch. 86, F.S., in order to obtain a declaratory judgment as to whether the condition at issue is indeed hazardous. If it is found that a hazardous walking condition exists, the superintendent must report the finding to DOE and formally request correction of the hazardous condition. Such formal process does not currently exist in statute.

In response to a request, the local government would be required to submit a position statement informing the superintendent whether the correction will be included in its next annual 5-year transportation work program and when the correction will be completed. Again, if it refuses to include correction of the condition in its five-year plan, it must provide a written statement explaining why to both the school district and the DOE.

Last, the bill adds a new provision which provides that designation of a hazardous walking condition is not admissible as evidence in a civil action for damages brought against a governmental entity under s. 768.28, F.S., relating to waiver of sovereign immunity.

Update: On Monday, the (S) Appropriations Subcommittee on Education passed CS/CS/SB 154 without amendment. It will next be heard in (S) Appropriations, the Senate bill’s last committee of reference. CS/HB 41 is currently in the (H) Education Appropriations Subcommittee.

Civil Liability for Farmers (SB 158 & HB 137)

Background: It is common practice by farmers to open up their lands to visitors after commercial harvesting is completed in order to pick any remaining excess crops not yet harvested, a process known as “gleaning.” This may be done as part of an agritourism attraction or as a charitable gesture toward needy families in the area. During such gleaning seasons, the farmer is exempt from liability for any injuries or deaths to visitors resulting from a known hazardous condition of which that the farmer has provided adequate warning. This exemption does not extend to instances of gross negligence or intentional acts.

Proposed Changes: This bill extends the civil liability exemption a bit further. It provides that a farmer is exempt from liability so long as they do not fail to warn their visitors of a hazardous condition on their land that they are aware of or in cases where the condition would be obvious enough to a visitor upon entering the farmer’s land. (Note: Under the House version, such conditions would include the condition of the crops being picked)

It also expands the timeframe of the exemption from just after harvest to being year round.Farmers would still be liable for any gross negligence or intentional acts on their own part.

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Update: On Tuesday, the (H) Civil Justice Subcommittee passed HB 137 without amendment. Its next committee stop is the (H) Agriculture & Natural Resources Subcommittee. SB 158 was rolled to Third Reading in the Senate on Wednesday.

Public-Private Partnerships (SB 824 & CS/HB 63)

Overview: Public-private partnerships (sometimes referred to as P3s) are contractual arrangements between a responsible public entity and a private entity for the purpose of carrying out public projects. Current law authorizes P3s for specified public purpose projects if the responsible public entity determines that the project is in the public’s best interest, that there is a need for or benefit derived from the project, the estimated cost of the project is reasonable, and the private entity’s plans will result in the timely acquisition, design, construction, improvement, renovation, expansion, equipping, maintenance, or operation of the qualifying project.

In 2013, the Public-Private Partnerships Task Force was convened for the purpose of establishing guidelines for the Legislature to develop a uniform process for establishing public-private partnerships, including the types of factors public entities should review and consider when processing requests for public-private partnership projects. In 2014, the Task Force issued its final report and a list of recommendations.

This bill incorporates many of the Task Force’s recommendations and touches on various issues that have bearing on the P3 process.

Definition of “Responsible Public Entity”

Background: The current definition in statute for “responsible public entity” includes the following: counties, municipalities, school boards, or “any other political subdivision of the state, public body corporate and politic, or regional body that serves a public purpose and is authorized to develop or operate a qualifying project.”

Proposed Changes: This bill would add school districts, special districts, state universities, or any Florida College System institution to the list of public entities covered under that definition.

Application Fees & Unsolicited Proposals

Background: While public entities may receive unsolicited proposals for public projects, they are also allowed under current law to charge a fee for receiving these proposals. The fee is meant to cover the cost of evaluating the proposal and therefore must be reasonable and sufficient toward that end.

Proposed Changes: This bill would make it a requirement for vendors who submit an unsolicited proposal to pay any evaluation fees in cash, cashier’s check, or other non-

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cancelable instrument. Personal checks would no longer be accepted. If the original payment does not fully cover the cost of evaluation, the public entity would need to inform the vendor of this and the vendor in turn would be required to make additional payment within 30 days. Should they not do this, the public entity may suspend their evaluation. However, should the public entity decide not to evaluate the unsolicited proposal, they would also have to refund the original application fee to the private vendor.

The bill would also remove provisions allowing public entities to hire outside consultants in the evaluation process.

Last, any pricing terms and financial terms included in the unsolicited proposal must be specific as to when the pricing or terms expire.

Notice to Affected Jurisdictions & Solicitation Timeframes:

Background: Whenever a public entity receives an unsolicited proposal, or wishes to solicit a proposal, they must publish notice of this in the Florida Administrative Register (FAR) and a newspaper of general circulation. They then have between 21 and 120 days to review the proposal and any counter-proposals submitted by other vendors.

Local jurisdictions affected by the qualifying project must also be notified and receive a copy of the proposal, and those which are not responsible for the project have 60 days in which to register their concerns as to the project’s compatibility with any local comprehensive plans, infrastructure development plans, or developments of regional impact plans.

Proposed Changes: This bill would allow a public entity, by majority vote of its governing board, to alter the evaluation timeframe if an alternative timeframe would more adequately serve the needs of the qualifying project. It also removes the requirement that affected jurisdictions not responsible for the qualifying project be notified, although the responsible public entity would still have to submit a copy of the notice published in FAR concerning solicitations for qualifying projects in their area.

Comprehensive Agreements & Financing Agreement

Background: In order to enter into a public-private partnership, a comprehensive agreement must be developed between the private and public entity. The agreement must ensure that the project will be cost effective, is in the public interest, and that the project will be conveyed to the public entity’s ownership upon completion or termination of the agreement.

Financing for the project may be secured by the public entity via traditional methods (commercial bank loans, federal bank loans, hedge funds, etc.), however, no financing agreement entered into between a public entity and a funding source is allowed to require that the public entity pledge security interest against their lien on the project.

Proposed Changes: This bill would add the requirement that ownership of the public project be conveyed to the public entity on expiration of the comprehensive agreement, not just its

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completion or termination. A copy of the comprehensive agreement may be provided to the Department of Management Services (DMS) after all confidential and exempt information has been redacted for the purpose of sharing it with other responsible public entities, however this is not requirement.

The bill also further clarifies that any financing agreement with a funding source must not require the responsible public entity to secure financing by a mortgage on, or security interest in, the real or tangible personal property of the responsible public entity in a manner that could result in the loss of the fee ownership of the property by the responsible public entity.

Finally, this bill deletes the provisions creating the Public-Private Partnership Task Force, as it has already fulfilled its task and is now obsolete.

Update: On Tuesday, the (S) Community Affairs Committee passed SB 824 after adopting one late-filed amendment. The late-filed amendment adds a provision that would require a public entity that solicits proposals to also include a design criteria package along with the solicitation. The criteria package must specify performance-based criteria for the project, including a legal description of the site, with survey information; interior space requirements; material quality standards; schematic layouts and conceptual design criteria, with budget estimates; design and construction schedules; and site and utility requirements. The criteria package must be prepared by an engineer or architect licensed in the state of Florida.

CS/SB 824 will next be taken up in the (S) Governmental Oversight & Accountability Committee. CS/HB 65 is currently in the (H) Local Government Affairs Subcommittee.

Public Records & Public Meetings/Pubic-Private Partnerships (SB 826 & CS/HB 65)

Background: Public-private partnerships (sometimes referred to as P3s) are contractual arrangements between a responsible public entity and a private entity for the purpose of carrying out public projects. Under state law, public entities may receive unsolicited proposals from private entities for certain projects or solicit for bids themselves. Should a public entity agree to consider entering into a P3 partnership with a private entity that has submitted an unsolicited proposal, they must post a public notice of this agreement and a notice that they are open to competing proposals in the Florida Administrative Register (FAR), as well as in a newspaper of general circulation at least once a week for two weeks.

Under Florida’s Sunshine Law and Article 1, sec. 24(a) of the Florida Constitution, meetings in which official actions are taken must be open to the public, and the affected public must be given reasonable advance notice of the meeting. Meetings in which competing bids are discussed are not specifically exempt from these requirements. However, there is a limited exception for those meetings that involve the vendor themselves making a presentation regarding their bid. In such circumstances a complete recording of the meeting must still be made.

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There is also no exemption from the details of unsolicited bids being posted publicly, except in cases where such bids, proposal, or replies are “sealed” (in order to protect trade and business secrets), in which case they are exempt from public record for a period of 30 days after the bid is opened or until the public agency makes a decision, whichever comes sooner. Should the public agency reject all bids, but make known its intention to resume the bidding process sometime in the near future, the bids would remain exempt until such time as the public entity makes its final decision to either fully reject the bid or accept. In either case, this period cannot be more than 12 months after the initial rejection of all bids. These same time-based exemptions apply to any records made or presented at those meetings in which bid proposals are discussed.

Proposed Changes: This bill, which is tied to the passage of CS/HB 63, would create a specified exemption from the Sunshine Law and Art 1, sec. 24(a) for meetings and records relating to unsolicited bids for public facilities and infrastructure. This exemption would extend until such time as the public entity provides notice of its intended decision. Should the responsible public entity reject all proposals, but make known its intention to seek additional proposals for the project, the initial bid would remain exempt for a further 90 days, or 180 days should no more competitive solicitations be made by the public entity. A full record of the meeting must still be made and released upon the agency making its final decision or within 90 days of it rejecting all proposals (or 180 days, should they not make anymore competitive solicitations)

These exemptions would expire under the Open Government Sunset Review Act in 2020 unless re-enacted by the Legislature. The bill also provides a statement of public necessity as required by the Florida Constitution.

Update: On Tuesday, the (S) Community Affairs Committee passed SB 826 without amendment. Its next committee stop is the (S) Governmental Oversight & Accountability Committee. CS/HB 65 is currently in the (H) Local Government Affairs Subcommittee.

Associations of Government Officials (CS/HB 549 & SB 1114)

Background: In Florida, non-profit corporations are regulated by the Florida Not For Profit Corporation Act (Act), which outlines the requirements for creating and managing a non-profit as well as the powers and duties of the corporation.

Non-profit corporations must submit an annual report to the Department of State that contains basic information about the corporation, including the date of incorporation, the names and addresses of the corporation’s directors and principal officers, and the addresses of certain corporate offices.

A non-profit may receive public funds either from the state or a local government in certain situations, such as through a grant or through payment of membership dues authorized for governmental employees and entities that are members of certain types of non-profits.

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Membership associations operate like non-profits in many respects: in some circumstances they can receive state funding, all their income goes towards running the organization, and their paying membership may include government employees.

Background: This PCS would require membership associations to file an annual report with the President of the Senate and the Speaker of the House of Representatives by January 1 of each year.

The bill defines a “membership association” as a corporation not for profit, including a department or division of such corporation, whose membership includes elected or appointed public officers and which receives 25 percent or more of its annual revenue from public funds. The bill specifically states that this term does not include labor organizations.

The report submitted to the legislature must include contact information for the membership association, officers and representatives of the membership association, and any affiliates of the membership association. It must also include information about the membership association’s finances, including the amount of the fee to become a member and of the annual membership dues, a copy of its current financial statements, a statement of assets and liabilities, a listing of salary and benefit packages paid to each officer and employee who received more than $10,000 from the membership association during the preceding fiscal year, and the amount of disbursements for lobbying activity and litigation.

The bill also prohibits a membership association from expending moneys received from public funds on litigation against the state.

Update: On Tuesday, the (S) Community Affairs Committee adopted a strike-all amendment to SB 1114. The strike-all conformed the Senate bill to the substance of the House bill as it stood on that date; except in one key respect- in the new Senate bill the membership of the association must not only include elected and public official officials but that they must constitute “a majority” of the membership in order for the association to be covered by the bill’s provisions. It is unknown whether the Senate will further amend the Senate bill to conform with the amendment adopted on Thursday to the House bill.

On Thursday, CS/HB 549 was passed by the (H) Appropriations Committee with one amendment. The amendment changes the definition of “membership association” to a “non-profit,” the majority of whose board members are “constitutional officers who operate, control, and supervise public entities that receive annual state appropriations through a statutorily defined formulaic allocation that is funded and prescribed annually in the General Appropriations Act or substantive bill implementing [the Act].”

The definition specifically excludes labor organizations or any entity funded through the Justice Administrative Commission.

CS/SB 1114 will next go before (S) Appropriations, its last committee of reference.

CS/CS/HB 549 will now go before (H) State Affairs, also its last committee of reference.

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Local Government Construction Preferences (CS/CS/HB 113 & CS/SB 778)

Background: Current state law requires each state agency, university, college, school district, or other political subdivision of this state to award a preference to Florida-based businesses for the purchase of personal property through a competitive solicitation even when the lowest responsible and responsive bid, proposal, or reply is by a vendor whose principal place of business is physically located in another state. If the out-of-state bidder ’s home state offers their own in-state preference, then the preference given to Florida based vendors is limited to whatever preference is provided by the out-of-state bidder’s home state. Otherwise, in a competitive solicitation in which the lowest bid is submitted by a vendor from an outside state which does not grant a preference, a 5 percent preference is given to the lowest responsible and responsive vendor having a principal place of business in Florida.

Proposed Changes: This bill would expand the breadth of this preference down to the county and municipal level (Senate version only). It also provides that in cases where the competitive solicitation for construction services is for a project in which 50 percent or more of the cost is being paid for by state funds, a political subdivision would not be allowed to enforce any local ordinance or regulation that restricts a certified contractor from competing for the award based on the contractor’s principal place of business, their hiring from within the local jurisdiction, or prior payment of local taxes, assessments, or duties.

To further this goal, political subdivisions of the state would be required to disclose certain information regarding the use of funds appropriated by the state in its competitive solicitation document.

Update: On Tuesday, the (S) Governmental Oversight & Accountability Committee adopted a strike-all to CS/SB 778 that conforms the bill to be identical to the House companion, CS/CS/HB 113 (described above). CS/CS/SB 778 will next be heard in the (S) Appropriations Committee, the last committee of reference for the Senate bill. On Thursday of the same week, CS/CS/HB 113 was passed without amendment the (H) Appropriations Committee. It will now go to the (H) State Affairs Committee, which is the House bill’s last committee of reference.

Public Records/Public Agency Contracts (CS/CS/SB 224 & CS/HB 163)

Background: The Florida Constitution provides every person the right to inspect or copy any public record made or received in connection with the official business of any public body. Should a public agency unlawfully fail to provide a public record, the person making the public records request may sue to have the records request enforced. If the courts should find that the agency unlawfully refused access to a public record, the court must order the public agency to pay for the requestor’s legal costs and attorney fees. Once an enforcement action has been

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filed, a public agency can be held liable for attorney fees even after the public agency has produced the requested records.

Private contractors who act on behalf of a public agency are required to comply with these public records laws in the same manner as a public agency, and public agencies in turn are charged with making sure that the contractors they employ adhere to these rules. Like the state agencies, contractors are legally liable if they do not release documents of public record on request or put unlawful conditions on the release of said materials.

In 2014, a court in Duval County found that a public request for information from a private individual to a non-profit working for the Department of Children and Families was “unreasonable” and likely made with the intent of garnering exorbitant attorney fees from the contractor for its initial denial of records, records which the contract manager asserted were not even of public import.

Proposed Changes: This bill would make three substantive changes.

First, it would require all requests for public records to be made through the public agency, not the contractor. If the public agency does not have the records, it must inform the contractor of this request and the contractor must furnish the requested records within a reasonable time frame. Upon completion of the contract, the contractor may either retain the records in their custody or transfer them, at no additional cost, to the public agency’s designated custodian of records. The Senate version prescribes that should a contractor decide to hold on to their records, that they are required, upon request of the public custodian, to either forward the documents or copies to the public custodian or allow the documents to be accessed and copied.

Second, it requires contracts for services to include a statement in large, bold font informing the contractor of the name and phone number of the public agency’s records custodian in order to fulfill the contractor’s constitutional duty to provide public records relating to the contract by redirecting queries to the public custodian’s office.

Last, courts would still be required to award attorney’s fees to a plaintiff in a public records case, but in order for the assessment to be awarded the plaintiff must first have provided written notice to the public agency’s records custodian at least three days (five in the Senate Ver.) in advance of the suit being filed. If the contractor is named as a party in the suit, they too must be informed within that period.

Update: Tuesday, the CS/HB 163 was passed by the (H) Government Operations Appropriations Subcommittee after they adopted a single amendment. The amendment makes two changes: it conforms the exact wording of that contact information that must be printed in the contract to that specified in the Senate bill, and it sets a date (July 1st, 2015) when this provision must go into effect (in other words it is not retroactive). CS/CS/HB 163 will next be heard in the (H) State Affairs Committee, its last committee of reference. CS/CS/SB 224 is currently in the (S) Committee on Fiscal Policy, also its last committee of reference.

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(SB 404 & HB 973) Improvements to Real Property Caused by Sinkhole Activity

Background: This bill concerns two existing programs where local governments have authority to finance improvements to the real property in their districts. The first is the Property Assessed Clean Energy (PACE) program, which allows individual owners of residential, commercial, or industrial properties to contract directly with qualified contractors for energy efficiency and renewable energy projects. The local government provides up front funding for the project through proceeds of revenue bonds, which is repaid through an assessment on participating property owners’ tax bills.

The second is the Community Redevelopment Act, which allows local governments to create Community Redevelopment Areas (CRAs) in areas under their jurisdiction that are “blighted” or otherwise economically depressed. Among the things a CRA can do is contract for improvements to abandoned or vacant properties, as well as dispose of property at fair market value. CRAs may not levy or collect taxes, although the authorizing local government can create a trust fund that is funded through tax increment financing (TIF). Improvements to the real property of the district are financed through this fund.

Both these programs deal with improvements relating to home energy efficiency and economic development, respectively, and heretofore have had no relation to improvements meant to protect and mitigate property against damage caused by sinkhole activity (of which in Florida there is a significant amount.)

Proposed Changes: This bill would authorize local governments to enter into financing agreements with property owners to finance qualified improvements to property damaged by sinkhole activity under the PACE program. Additionally, the bill expands the definition of “blighted area,” enabling community redevelopment areas to enter into voluntary contracts to redevelop properties damaged by sinkhole activity.

Update: SB 404 was passed on Tuesday by the (S) Banking & Insurance Committee without amendment. It next committee stop is (S) Finance & Tax. HB 973 is currently in the (H) Economic Development & Tourism Subcommittee.

Water & Wastewater (SB 776 & 1173)

Background: This bill touches on different subjects relating to investor-owned water and wastewater utilities. Investor-owed utilities (IOUs) are privately owned utilities set up for the express purpose of making a profit, and can vary considerably in size from very small systems, owned by an individual as a sole proprietorship and serving only a few dozen customers, to systems owned by large interstate corporations serving tens of thousands of customers in multiple counties. IOUs, provided that they are not already regulated by a local government or other regional agency, are directly regulated by the Florida Public Service Commission (PSC). The PSC has the power to mediate between a utility and it’s customers, and has almost

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complete authority over setting the utility’s rates, which it does in the interest of seeing that customers are given adequate service at a reasonable cost.

There are 145 IOUs in Florida that are under the direct purview of the PSC.

Not all entities that sell and provide water are “utilities”, in the strict sense. Some small companies, individuals, and property associations pump their own water or simply resell the water provided to them by a utility to their tenants. Under current law, a “re-seller” cannot sell the water they get from a utility for more than what the utility charged, otherwise they could be reclassified as a utility themselves and thus be under PSC regulation. This expense consideration does not take into account the costs incurred from sub-metering, which means that in order to cover the cost, mobile home parks and condominium associations sometimes end up raising rents across the board instead of billing customers directly proportional to their actual water use.

In order for an IOU to increase its rates, it must file an application for a rate increase with the PSC. The application includes schedules and reports containing operational, financial, economic, and rate information in order for the PSC staff to evaluate the request. The utility is also required to forecast how much funding is necessary to cover expenses for the next year and the potential return on investment from assets used to provide services.

When considering a rate increase, PSC must also consider the quality of the water service. Utilities shown to be providing sub-par service can have part or all of their rate increase denied or incur other penalties, such as a reduction of return on equity.

Not all rate increase or decreases require PSC approval. The law allows utilities to adjust their rates in response to certain expense items that fluctuate frequently and which are out of the utility’s control. Under current statute, these items include:

oPurchased water or wastewater servicesoElectric poweroAd Valorem taxesoRegulatory assessment feesoDEP fees for the National Pollutant Discharge Elimination System ProgramoWater & wastewater testing required by the DEP

When filing a rate case, a utility may request staff assistance from the PSC. They may also hire an outside attorney or consultant whether they are filing for a rate case, appealing a PSC decision, or responding to an appeal from a third party. In either case, the rules regarding how utilities may recover the cost of hiring an outside advocate or expert are not quite clear.

Proposed Changes & Update: On Wednesday, the Environmental Preservation & Conservation Committee adopted a strike-all (plus one tech. am.) for SB 776.

The strike-all would do the following:

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Require the Division of Bond Finance of the State Board of Administration to review the allocation of private activity bonds in order to determine the availability of additional bonds for re-allocation to water and wastewater infrastructure projects.

Exempt investor owned water and wastewater utilities that are based and operate in Florida from the tax on sales and leases.

Allow a person who resells water service to their tenants or to individually metered residents to charge a fee that covers the cost of both purchase and metering, so long as this fee does not exceed 9% of the actual cost of service.

Allow the PSC, when establishing rates for a utility, to create a utility reserve fund for infrastructure repair and replacement of obsolete or damaged utility infrastructure that is negatively impacting service and water quality. It can be funded by either a portion of the rates charged, by a secured escrow account, or by a letter of credit.

Expand the list of expense items that would automatically merit a decrease or increase in the rates to the following:

o Approved rates for utilities receiving all or a portion of their services from a governmental authority or another utility regulated by the PSC who then redistributes those services among their own customers.

o Rates and fees the utility is charged for electric power.o The amount of ad valorem taxes assessed against used and useful property.o Fees charged by the DEP in connection with the Pollutant Discharge Program.o Regulatory assessment fees imposed by the PSC.o Costs incurred for water and wastewater quality testing required by the DEP.o Fees charged for wastewater biosolids disposal.o Costs incurred for tank inspections required by the DEP or local government.o Operator and distributor licensing fees, and water and wastewater operating

permit fees required by either the DEP or local government.o CUPs or water use permit fees charged by a WMD.

A utility may not increase its rates due to an increase for a specific expense item that occurred more than 12 months before the filing. The PSC may add new expense items to this list by rule and must review the list every 5 years in order determine if any changes must be made.

Provide that a utility may only recover up to 50% of the rate case expenses deemed reasonable by the PSC.

Provide that rates may not be increased to cover the costs of attorneys or outside consultants for a rate case in which staff assistance was provided by the PSC, the exception being in cases where the Office of Public Counsel or interested parties have intervened, or if these services are provided after the staff report is released or after a protest or appeal has been made by an outside party.

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Provide that expenses may only be recovered for one rate case at a time. Amortized rate case expenses accumulated over a four-year period may not be included in a current rate case filing.

Authorize the PSC, either on its own initiative or in response to complaints by customers, to review water quality based on secondary drinking water standards established by the DEP, as well as any wastewater service as it pertains to odor, noise, aerosol drift, or lighting.

Allow the Florida Water Pollution Control Financing Corporations, by request or order of the DEP, to issue loans, grants, and deposits to private, investor owned water systems for infrastructural improvements.

CS/SB 776 will next be heard in (S) Finance & Tax. HB 1173 is currently in the (H) Energy & Utilities Subcommittee.

Private Property Rights (CS/SB 383)

Background: Chapter 70, Florida Statutes, contains four provisions of law respecting private property rights; another of which (s. 70.001) is the Bert Harris, Jr. Private Property Rights Act; another of which (s. 70.51) is the Florida Land Use and Environmental Dispute Resolution Act.

Proposed Changes: The bill creates a new section of law, s. 70.45, creating a cause of action to recover monetary damages for landowners where local and state governmental entities impose conditions that rise to the level of unconstitutional exactions.

The bill also amends the Bert J. Harris, Jr., Private Property Act to provide that only those property owners whose real property is the subject of and directly impacted by the action of a governmental entity may bring suit under the Act and to provide that the Act’s safe harbor provisions for settlement agreements between a property owner and governmental entity apply regardless of when the settlement agreement was entered.

Update: The bill was heard Wednesday in the House Local Government Affairs Commmittee, where a strike-everything amendment was adopted (the amendment is described above in the proposed changes section). This was the bill’s second committee stop, and the bill has two additional stops before reaching the floor. At this point there is no analogous Senate companion bill.

Miami-Dade County Lake Belt Area (CS/HB 359 & SB 510)

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Background: The Miami-Dade County Lake Belt Area (Lake Belt) encompasses 77.5 square miles of environmentally sensitive land at the western edge of the Miami-Dade County urban area. The Lake Belt contains deposits of limestone and sand used in the production of construction aggregates, cement, and road base materials. Rock mined from the Lake Belt supplies one half of the limestone used annually in Florida.

Under current law, the mining companies operating in the Lake Belt must pay a combination of fees based on the number of tons of limestone or sand extracted and sold from the area. The fees are used to conduct wetland mitigation activities, fund seepage mitigation projects, and under certain circumstances, fund plant upgrades for a water treatment plant in the Northwest Well Fields of Miami-Dade County.

Proposed Changes: This bill would make the following revisions to the Lake Belt statutes:

Requires amendments to local zoning and subdivision regulations so that properties located within one mile of the Lake Belt are compatible with limestone mining activities. Prohibits amendments to local zoning and subdivision regulations that would result in an increase in residential density in certain parts of the Lake Belt until active mining operations cease within two miles of the property. Reduces the mitigation fees over time from 45 cents per ton to 25 cents per ton beginning January 1, 2016, to 15 cents per ton beginning January 1, 2017, and to 5 cents per ton beginning January 1, 2018. Requires proceeds from the mitigation fee to be used to conduct water quality monitoring to ensure the protection of water resources within the Lake Belt. Removes the requirement that the South Florida Water Management District use the water treatment plant upgrade fee to pay for seepage mitigation projects. Replaces the water treatment plant upgrade fee with an environmentally endangered lands fee. The bill also reduces the fee from 15 cents to 5 cents per ton of lime rock and sand sold. Requires proceeds from the environmentally endangered lands fee to be used solely for the acquisition, preservation, enhancement, restoration, conservation, and maintenance of wetland and threatened forest communities located in Miami-Dade County, not just near the Lake Belt. (House Ver. Only- Proceeds from the environmentally endangered lands fee can be reverted to plant upgrades in the event that quarterly sampling of water quality in the lake belt area tests Bin 2 or higher [as defined by the EPA’s Long Term 2 Enhanced Surface Water Treatment Rule] for pathogens.) Removes requirement that the Miami-Dade County Mitigation Committee approve the use of mitigation fee proceeds for environmental mitigation and water quality monitoring. (House Ver. Only)

Update: On Thursday, the (H) State Affairs Committee passed CS/HB 359 without amendment. It will now be placed on the Special Order Calendar. SB 510 is currently in the (S) Environmental Preservation & Conservation Committee.

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Agritourism (CS/SB 594 & CS/HB 569)

Background: “Agritourism” is any agricultural related activity that takes place on a bona fide farm, ranch, or working forest that allows members of the general public to view or enjoy activities such as harvest-your-own produce, farming, or ranching. Under current statute, local governments may not enact a regulation, rule, or policy that would limit an agritourism activity on land classified as agricultural.

Proposed Changes: This legislation would expand this prohibition. Local government would be prohibited from enforcing any local ordinance as well as any local regulation, rule, or policy that prohibits, restricts, regulates, or otherwise limits an agritourist activity on land classified as agricultural.

Update: CS/HB 569 was passed on Thursday in the (H) State Affairs Committee without amendment. It is now on the House Special Order Calendar. The Senate companion, CS/SB 594, is currently on the Senate’s Special Order Calendar.

Land Application of Septage (SB 648 & CS/HB 687)

Background: There are an estimated 2.6-million onsite sewage treatment & disposal systems (OSTDS’s or, colloquially, “septic tanks”) in Florida. There are approximately 2.6 million onsite sewage treatment and disposal systems (OSTDSs or septic tanks) in the state, serving approximately 30 percent of the population. Each year, nearly 100,000 OSTDSs are pumped out, generating 100 million gallons of septage. Septage is the mixture of sludge, fatty materials, human feces, and wastewater removed during the pumping or cleaning of an OSTDS.

Current law prohibits land application of septage from OSTDSs effective January 1, 2016. However, according to a DOH report, reasonable alternative disposal options are currently too limited to handle the amount of septage that is currently being produced. In addition, the Department of Environmental Protection is currently studying the water quality impacts of permitted land application sites. The study is projected to be completed within two years.

Proposed Changes: The Senate version, as filed, would repeal the January 1, 2016 prohibition on land application of septage from OSTDS’s, and in its place implements new rules and regulations (in addition to any existing permit requirements) with regard to land applications:

If septage is applied to an area designated as a “spring protection and management zone”, a spring-shed where the Florida aquifer is vulnerable to sources of contamination or reduced water levels (as determined by DEP, in consultation with the appropriate water management district), the following measures would be required:o Monthly inspections by DOHo Metered receiving at treatment facilities.o Testing with electronic pH meters rather than paper strips.

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o Stabilized septage sampling.o Annual tracking of nutrient loading based on septage sampling and annual soil

sampling of active application sites.o Sites may not be sold, but may be transferred.o Additional sites cannot be permitted.

If applied to an area that is not designated as a spring protection and management zone, the following measures would be implemented:o Quarterly inspections by DOH.o Metered receiving at treatment facilities.o Testing with electronic pH meters rather than paper strips.o Sites may be sold or transferred.o Additional sites can be permitted.

The House version of the bill is less extensive; it simply moves the sunset date back by two years, from Jan. 1, 2016 to Jan. 1, 2018; enough time, according to the bill’s sponsor, for the DEP to complete its study.

Update: On Thursday, the (H) State Affairs Committee passed CS/HB 687 without amendment. It will now be placed on the House Special Order Calendar. The Senate companion, SB 648, is currently in (S) Environmental Preservation & Conservation.

Growth Management (SB 562 & HB 579)

Overview: This bill deals with two issues relating to growth management: the DRI process, and amendments to local government comprehensive plans.

DRI Process

Background: A development of regional impact (DRI) is, generally speaking, any planned development that, because of its magnitude, character, or location, would have a substantial effect of the health, safety, and welfare of citizens of more than one county. Under current state law, developments that meet certain thresholds must undergo a DRI review by both the Department of Economic Opportunity (DEO) and the regional planning council in whose jurisdiction the development is located. The law, however, provides many exemptions and the number of new developments that are actually covered by the DRI process are relatively few.

Proposed Changes: This bill would exempt all new developments from the DRI review process. Those developments currently classified as DRIs and which are still undergoing DRI review would remain under the program.

Comprehensive Plan Amendments

Background: Whether a new development is approved under the DRI process or exempt from it, it must still be approved by the local government, and that usually involves a comprehensive

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plan amendment. A comprehensive plan lays out the locations for future public facilities, including roads, water and sewer facilities, neighborhoods, parks, schools, and commercial and industrial developments. A new development that does not conform to an existing comprehensive plan cannot be approved by a local government unless that local government amends its comprehensive plan first.

As with the DRI process, the proposed comprehensive plan amendment must first be submitted to review by several statutorily identified agencies and hold three public meetings to discuss the amendment.

In 2011, the Florida Legislature bifurcated the process for approving comprehensive plan amendments into two separate processes. Most plan amendments were placed into the Expedited State Review Process, while plan amendments related to large-scale developments were placed into the State Coordinated Review Process. The two processes operate in much the same way, however, the State Coordinated Review Process provides a longer review period and requires all agency comments to be coordinated by the DEO, rather than communicated directly to the permitting local government by each individual reviewing agency.

Proposed Changes: SB 562 was passed by the (S) Transportation Committee on Thursday. It will next be heard in (S) Rules, the last committee of reference for the Senate bill. HB 579 is currently in the (H) Economic Development & Tourism Subcommittee

Implementation of the Water and Land Conservation Amendment (HB 1291 & SB 584)

Background: On Nov. 14, 2014, Florida voters approved a ballot measure to add a new section to Article X of the state constitution. The section appropriates 33% of the documentary stamp tax to the state’s Land Acquisition Trust Fund (LATF). It provides that the funds may only be used for the following purposes:

1) As provided by law, to finance or refinance: the acquisition and improvement of land, water areas, and related property interests, including conservation easements, and resources for conservation lands including wetlands, forests, and fish and wildlife habitat; wildlife management areas; lands that protect water resources and drinking water sources, including lands protecting the water quality and quantity of rivers, lakes, streams, spring-sheds, and lands providing recharge for groundwater and aquifer systems; lands in the Everglades Agricultural Area and the Everglades Protection Area, as defined in Article II, Section 7(b); beaches and shores; outdoor recreation lands, including recreational trails, parks, and urban open space; rural landscapes; working farms and ranches; historic or geologic sites; together with management, restoration of natural systems, and the enhancement of public access or recreational enjoyment of conservation lands.

2) To pay the debt service on bonds issued pursuant to Article VII, Section 11(e).

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The Amendment specifically prohibits the comingling of LATF funds with the state’s General Revenue Trust Fund.

Proposed Changes: There is a series of bills to re-work, reorganize, and work through the various trust funds in the various state agencies affected by Amendment 1 and the requirements that funds not be commingled with other funds. HB 1291 & SB 584 are two of the primary bills in that series. In the interest of greater transparency as well as the even and effective distribution of the funds segregated by Amendment 1, the bills dissolve and consolidate many agency trust funds. These are lengthy and complicated bills (approximately 175 pages long) which make many technical changes – if the reader has a specific interest in the details of how the trust funds are reorganized, reference to the actual bills is strongly urged, rather than reliance on this summary, which is necessarily significantly less detailed. HB 1291 does the following:

(1) Revises documentary stamp tax distribution to reflect the required 33 percent distribution to the Land Acquisition Trust Fund.

(2) Eliminates the distribution to various trust funds currently receiving documentary stamp tax distributions, including Ecosystem Management and Restoration Trust Fund, Water Management Lands Trust Fund, Conservation and Recreation Lands (CARL) Trust Fund, General Inspection Trust Fund, Invasive Plant Control Trust Fund, State Game Trust Fund, and Water Quality Assurance Trust Fund.

(3) Maintains current documentary stamp tax distributions to State Economic Enhancement and Development Trust Fund, State Transportation Trust Fund, and state and local housing trust funds.

(4) Reduces documentary stamp tax distribution to the General Revenue Fund.

(5) Terminates the following trust funds: Department of Environmental Protection’s (DEP) Florida Communities Trust Fund, CARL Trust Fund, Ecosystem Management and Restoration Trust Fund, Florida Preservation 2000 Trust Fund, Water Management Lands Trust Fund, and Department of Agriculture and Consumer Services’ (DACS) and Fish and Wildlife Conservation Commission’s (FWC) Conservation and Recreation Lands Program Trust Funds; provides for the disposition of the cash balances of the terminated funds.

(6) Provides transparency and accountability relating to expenditure of LATF funds by creating a mechanism by which only LATF documentary stamp tax revenues are appropriated in the LATF.

(7) Specifies that DEP will transfer cash to other agencies’ LATFs by non-operating authority to fund appropriations in the annual General Appropriations Act.

(8) Specifies that any transferred moneys available from reversions or reductions of budget authority in the other agencies must be transferred back to the LATF in the DEP

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within 15 days after such reversion or reduction and be available for future appropriation pursuant to Art. X, s. 28 of the State Constitution.

(9) Revises the disposition of revenue from sale or other disposition of lands; forfeited property; fines and penalties; donations; sale of products; and operation, management or lease of conservation lands and facilities on those lands.

(10) Requires that interest earned on invested LATF accrue to the General Revenue Fund.

(11) Deletes phosphate rock severance tax distribution to the CARL Trust Fund and redistributes pro rata share to remaining recipients.

(12) Revises all environmental bonding provisions to comply with constitutional amendment and repeals all obsolete bonding provisions (CARL, Save Our Coasts, and Florida Preservation 2000).

(13) Revises DEP’s and FWC’s Land Acquisition Trust Funds to comply with constitutional amendment.

(14) Corrects cross-references and conforms provisions to changes made by the act.

SB 584 contains similar provisions, although it is not quite the same as HB 1291. Like the House bill, it terminates certain trust funds currently receiving documentary stamp tax revenue intended for expenditure on environmental programs and redirects those moneys (and moneys from other sources) deposited in those trust funds to other appropriate trust funds. It also:

(1) Clarifies dispositions of DEP obligations. Does not change any terminated trust fund obligations. All current remaining balances in the Ecosystem Management Trust Fund and Restoration Trust Fund, Water Management Land Trust Funds, and Conservation & Recreation Lands Trust Funds will be transferred to the Water Quality Assurance Trust Fund.

(2) Provides that grants and donations received by the DEP for preservation of aquatic reserves must be deposited in the Grants & Donations Trust Fund, not the Land Acquisition or State Parks Trust Fund.

(3) Amends s. 373.026(c)(8), F.S., repealing obsolete language for the South Florida Water Management District’s five-year acquisition plan.

(4) Provides that civil penalties recovered by WMDs and deposited in the Water Quality Assurance Trust Fund shall be retained and used exclusively by the WMD that collected the funds.

(5) Specifies remaining unobligated funds in the Fish & Wildlife Conservation Commission’s LATF be transferred to the Grants & Donations Trust Fund.

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Update: On Thursday, the (H) Appropriations Committee passed HB 1291; it heads next to the House Floor. On Thursday, the Senate Appropriations Committee adopted amendments to SB 584, bringing it closer to the provisions of the House bill, and holding harmless the transportation and affordable housing trust funds. The Senate bill heads next to the House floor.

Utility Projects (HB 617 & SB 1102)

Background: This bill creates an alternative method for financing the costs of certain utility projects using utility cost containment bonds. These bonds are issued by an “authority” (such as the Florida Governmental Utility Authority) on behalf of a local agency that owns and operates a publicly owned utility that provides public utility services, including water, wastewater, electric, or storm-water. The bonds may receive a lower interest rate because payment is secured by a pledge of the utility project. The primary utility project property is the utility project charge, which is imposed on customers, based on estimates of water, wastewater, electric, or storm-water service usage, to ensure timely payment of all financing costs with respect to utility cost containment bonds.

Proposed Changes: This bill would create an alternative method for funding public utility projects (specifically water, wastewater, or storm-water services) through the issuance of utility cost containment bonds, which unlike regular bonds that are financed through utility revenues would instead be financed directly from utility customer charges. Because these bonds would be financed directly through a pledge of the project’s property (i.e. the utility charges), they would be subject to lower interest rates.

In order to obtain utility cost containment bonds, a local agency that owns and operates a public utility would need to apply to an intergovernmental public utility authority (whose membership must consist of at least three counties) for authorization to finance a utility project with proceeds from the bonds. The authority would then issue the bonds on behalf of the agency after adopting a financing resolution that the agency must abide by, as well as a set utility project charge, which each of the utility’s customers who are specified in the financing resolution would be required to pay regardless of whether they are receiving water, wastewater, electric, or storm-water services from an entity other than the publicly owned utility. The authority may require in the financing resolution that, in the event of default by the local agency or its publicly owned utility, the authority must order the sequestration and payment to the beneficiaries of the revenues arising from the utility project property.

Before applying for bonds, the agency would first need to determine, based on the best information available to its governing body, that the new rates resulting from the financing of the utility project with cost containment bonds will not be higher than the rates that would be charged if the project were financed with bonds payable directly from the revenues of the publicly owned utility.

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The local agency must also specify the utility project to be financed by the cost containment bonds, as well as the maximum principal amount, the maximum interest rate, and the maximum stated terms of the utility cost containment bonds. An authority may issue utility cost containment bonds to finance or refinance utility projects; refinance debt of a local agency incurred in financing or refinancing utility projects, provided the refinancing results in present value savings to the local agency, or, with the approval of the local agency, refinance previously issued utility cost containment bonds. Should a local agency that has outstanding utility cost containment bonds cease to operate a water, wastewater, electric, or stormwater utility, these outstanding costs would automatically transfer to the successor entity. The successor entity would then have to assume and perform all the obligations of its predecessor and assume the servicing agreement while the utility cost containment bonds remain outstanding. They may not file for bankruptcy or pledge tax money for repayment of the bonds, nor can the authority alter, rescind, or amend any financing resolution. All the public utility’s property tied to the project must be pledged as security for the bonds. If the authority is financing the project through a single-purpose limited liability company, the bonds are payable from, and secured by, a pledge of amounts paid by the company to the authority from the applicable utility project property.

Currently, the Florida Governmental Utility Authority is the only intergovernmental authority that currently meets the criteria to provide financing under the bill. Thus, the bill expands FGUA’s original purpose of owning and operating a public utility system.

Update: On Wednesday, the (H) Energy & Utilities Subcommittee passed HB 617 without amendment. It was taken up again on Thursday the same week in the (H) Finance & Tax Committee and passed there as well, again without amendment. It is now in the (H) Regulatory Affairs Committee, the last committee of reference for the House bill. SB 1102 is currently in the (S) Senate Committee on Communications, Energy, & Public Utilities.

Freight Logistics Zones (SB 956 & HB 257)

Background: In 2012, the Legislature passed HB 599, directing FDOT to develop the Freight Mobility & Trade Plan. The main object of the Plan was to identify areas of the state’s intermodal logistics and freight networks whose improvement might boost the state’s overall ability to move freight and maintain its competiveness as a port state. These areas are defined in statute as “intermodal logistics centers,” generally a facility or group of facilities serving as a point of intermodal transfer of freight. They can include roads, rail facilities, warehouses, or any other facility tied to the logistical aspect of moving freight to and from the state’s seaports. These facilities are eligible for the funds under the state’s Intermodal Logistics Center Infrastructure Program, for which $5 million is annually allocated. There are also other development aid programs for which these transport facilities are eligible.

Proposed Changes: This bill would authorize a county or a group of contiguous counties to designate certain areas within their jurisdiction as Freight Logistics Zones (FLZs). This would allow projects within the zone that are consistent with the DOT’s Freight Mobility & Trade

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Plan to receive priority funding from the various applicable economic development programs listed under Parts I, III, and IV of Ch. 288. In designating a zone, the counties would have to submit a strategic action plan to FDOT, which must include:

A map depicting the geographic area or areas to be included within the designation. Identification of existing or planned freight facilities or logistics clusters located

within the proposed FLZ. Identification of existing transportation infrastructure, such as roads, rail, airports, and

seaports, within or in close proximity to the proposed FLZ. Identification of existing workforce availability within or in close proximity to the

proposed FLZ. Identification of any local, state, or federal workforce training capabilities available

for a business seeking to locate or expand within the proposed FLZ. Identification of any local, state, or federal plans, including transportation, seaport, or

airport plans, concerning the movement of freight within or in close proximity to the proposed FLZ.

Identification of financial or other local government incentives to encourage new development, expansion of existing development, or redevelopment within the proposed FLZ.

Documentation that the plan is consistent with applicable local government comprehensive plans and adopted long-range transportation plans of a metropolitan planning organization, where applicable.

The bill would also set criteria for evaluating which projects may receive priority funding. The existing cap of $5 million for the Freight Mobility and Trade would be changed into a minimum quota of $5 million, potentially increasing the amount of funds available for these projects.

Update: On Tuesday, HB 257 was rolled to third reading in the House and subsequently passed the next day. It will now be placed in Messages. SB 956 was passed on Thursday in the (S) Subcommittee on Transportation, Tourism, and Economic Development without amendment. It is now in the (S) Committee on Fiscal Policy, its last committee of reference.

Water Resources (CS/HB 7003)

This bill is the House’s overarching “water policy” bill for this session. It is a 94-page bill addressing a wide range of water resource, water quality, springs, and environmental protection and restoration programs.

Section 1 – Self-Suppliers eligible for assistance (lines 125-141)

• Amends s. 373.019(24), F.S., which defines “water resource development” to add self-suppliers to the list of entities that may receive technical assistance, in addition to government-owned and privately owned water utilities.

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Section 2 – Minimum Flows & Levels and Recovery and Prevention Strategies (lines 142-197)

• Amends s. 373.0421(2), F.S., to require that, concurrent with the adoption of a minimum flow and level (MFL), a governing board or department must expeditiously implement a recovery or prevention strategy if the existing flow or level in a water body is below, or projected to fall within 20 years below, the established minimum flow or level.

• Requires that a recovery and prevention strategy, to the maximum extent practicable, and that that a recovery or prevention strategy may not depend solely on declared water shortage restrictions.

• Requires that regional water supply plans (RWSPs) be amended to include any water supply development projects and water resource development projects identified in a recovery or prevention strategy, and that the amendment be approved concurrently with the relevant portions of the recovery and prevention strategy.

• Requires that the Department of Environmental Protection (DEP) be notified if an application for a water use permit is denied based on the impact that the use will have on an established MFL. Upon receipt of such a notice, DEP would be required, as soon as is practicable, and in cooperation with the district, to conduct a review of the RWSP, including an assessment by DEP of the adequacy of the plan. If DEP determines that additional actions are needed, the district would be required to initiate an update of the RWSP.

Section 3 – Central Florida Water Initiative (lines 198-312)

• Creates new sections of law regarding the Central Florida Water Initiative (CFWI).

• Defines the Central Florida Water Initiative Area to include all of Orange, Osceola, Polk, and Seminole Counties, and Southern Lake County, as designated by the Southwest, Florida Water Management District (SWFWMD), the South Florida Water Management District (SFWMD), and the St. Johns River Water Management District (SJRWMD).

• Requires, by December 31, 2015, DEP to complete a CFWI interagency agreement with the three affected water management districts and the Department of Agriculture and Consumer Services (DACS),and specifies contents for the interagency agreement, including, among other requirements, a single hydrologic model to assess the availability of groundwater, and other uniform or single rules that will apply across the CFWI.

• Provides guidance for development of the water supply and regulatory program consistent with the goals established by the Legislature, and requirements for the parties to the interagency agreement to consider.

• Provides that the planning and regulatory programs developed pursuant to the interagency agreement will be approved as provided in Chapter 373, but that they shall not serve to modify planning and regulatory programs in areas of the affected districts that are not within the CFWI. They may, however, include

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interregional projects located outside the CFWI that are consistent with planning and regulatory programs in the areas in which they are located.

Section 4 – SFWMD as local sponsor of Central and South Florida Project for Flood Control and Other Purposes (lines 313-344)-

• Amends s. 373.1501(4), F.S., which authorizes SFWMD to act as local sponsor for the project, but adds new language to provide that SFWMD shall continue to exercise the authority of the state to allocate quantities of water within its jurisdiction, including the water supply in relation to the project, and be responsible for allocating water and assigning priorities among other water uses served by the project pursuant to state law.

• Adds a new (7) to that section, providing that “when developing or implementing water control plan or regulation schedules required for operation of the project, the district shall provide recommendations to the United States Army Corps of Engineers that are consistent with all district programs and plans.”

Section 5 – Preferred water supply sources (lines 345-391)-

• Amends s. 373.2234, F.S., to add a new (2)(b), which states that “the governing board of a water management district shall consider the identification of preferred water supply sources for water users for whom access to or development of new water supplies is not technically or financially feasible.”

Section 6 – Competing applications (lines 392-403)–

• Amends s. 373.223, F.S. to add a new (2)(b), providing that “if two or more competing applications qualify equally under subsection (1) and none of the competing applications is a renewal application, the governing board or the department shall give preference to the use for which an alternative water supply is not technically or financially feasible.

Section 7 – Improvements on private agricultural lands (lines 404-446)

• Amends s. 373.4591, F.S., to add groundwater recharge to the existing list of things the Legislature encourages as public-private partnerships on private lands, which include with water storage and water quality improvements.

• Requires that the districts give priority consideration to public-private partnerships that

o Store or treat water on private lands for purposes of hydrologic improvement, water quality or water supply;

o Provide critical ground water recharge, oro Provide for changes in land use to activities that minimize nutrient loads

and maximize water conservation.

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• Adds DACS and DEP to the list of potential agreement partners for public private partnerships, and adds clarifying language that a baseline condition of wetlands and surface waters may be established and documented.

Section 8- Northern Everglades and Estuaries Protection Program – (lines 447-1744)

• Amends s. 373.4595, F.S. makes a number of somewhat complex changes to this extensive and lengthy statute that affects lands north of Lake Okeechobee, Lake Okeechobee, the St. Lucie watershed, and the Caloosahatchee watershed. However, there have been a number of critiques from some members of the environmental community with regard to the provisions in this section, and concerns have been voiced about whether some of the proposed modifications change the regulatory framework with regard to water quality issues. On the other side, proponents of the language in the bill have stated their intention, and the actual effect of the changes is only to clean up, update to conform with current rules, make consistent, and avoid duplication and overlap of existing programs with regard to the Northern Everglades and Estuaries Protection Program. The debate continues on these issues, and as the bill is negotiated with the Senate, these issues will be worked through. Rather than detail all of the changes, which are too lengthy for this report, if you have questions regarding this section, please call Lee Killinger at Anfield and we can discuss them.

Section 9 – Water Management District Budgets – (lines 1745-1818)

• Amends s. 373.436(a) and (b), F.S., with regard to the water management district budgets, to require that the districts include, in their 5 year water resource development work program, an annual funding plan for each of the 5 years included in the plan for the water resource and water supply development components, and to require that the district identify water supply projects proposed for district funding and assistance. The annual funding plan also would be required to identify both anticipated available district funding and additional funding needs for the second through fifth years of the funding plan, and the district’s work program would be required to provide an assessment of the districts RWSPs to supporting the implementation of MFLs and reservations, to ensure sufficient water is available and to avoid adverse effects of competition for water supplies.

Section 10 – Water Production (lines 1819-1839)

• Amends s. 373.703, F.S., to add private landowners to the list of entities with whom the districts may join to develop water resources or water supplies. (That list currently includes other water management districts, counties, municipalities, special districts, publicly owned or privately owned water utilities, multijurisdictional water supply entities, regional water supply authorities, and self-suppliers.)

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Section 11 – Water resource development; water supply development (lines 1840-1877)

• Amends s. 373.705, F.S., to add legislative intent that the districts include, in their water resource development projects, “regionally significant projects that prevent or limit adverse water resource impacts, avoid competition among water users, or support the provision of new water supplies in order to help implement a minimum flow or level or water reservation.”

• Requires that the governing board include in its annual budget submittal the amount of funds for each project in the annual funding plan developed by the district.

• Adds to the existing list of priorities for water supply development projects to include projects that reduce or eliminate the adverse effects of competition between legal users and the natural system.

Section 12- Alternative water supply development – (lines 1878-1934)

• Amends s. 373.707, F.S., to allow self-suppliers to receive technical and financial assistance from the water management districts with regard to alternative water supply projects. (The current list includes publicly owned and privately owned water utilities.)

• Allows the districts to partially or totally waive an existing 60 percent construction cost match for projects for water users for projects determined by a water management district governing board to be in the public interest, if the projects are not otherwise financially feasible.

Section 13 – Regional water supply planning – (lines 1935-2038)

• Clarifies that that the projects included in RWSPs must be technically and financially feasible.

• Requires that RWSPs contain an analysis of the sufficiency of potential sources of funding from all sources for water resource development and water supply development projects.

• Requires that RWSPs include, in their overall assessment of progress being made to develop water supply in each district, an explanation of how each project in the 5-year water resource development program will move toward that goal, and adds MFLs and reservations to the list of goals for water development by each district.

Section 14 – Springs – (lines 2039-2234)

• Creates the Florida Springs and Aquifer Act, ss 373.801-809, F.S.• Contains legislative findings regarding springs problems and legislative intent

regarding solutions.• Defines “Priority Florida Springs” (PFS) as “all first magnitude springs in the state

and all second magnitude springs within state or federally owned lands purchased for conservation purposes.”

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• Provides the primary responsibilities of the DEP, DACS, water management districts, and local governments:

o DEP has primary responsibility for water quality protection through the establishment of basin management action plans and other water quality regulations

o The districts have primary responsibility for the hydrologic recovery of spring flow through the establishment of MFLs and recovery plans.

o DACS has primary responsibility for the development and implementation of best management practices (BMPs) for agricultural nonpoint sources.

o Local governments have primary responsibility for providing urban stormwater management services pursuant to the provisions of their separate municipal storm sewer system permits and operation of wastewater collection and treatment facilities.

• Provides that DEP, DACS, and the districts shall prioritize the implementation of financial assistance and community outreach programs for springs protection that support actions to reduce nutrient loading to the environment and prevent or abate nutrient over-enrichment of the springs. That may include BMPs, connecting centralized sewer systems to densely populated areas that are presently served by onsite systems, and stormwater management improvements, and supporting implementation of ordinances consistent with the Florida-Friendly Fertilizer Use Model Ordinance.

• Requires that for any MFL initially adopted for PFS after July 1, 2015 where the PFS is below or projected to fall below the initial MFL, the district shall simultaneously approve a recovery or prevention strategy.

• Requires that when an MFL is revised, if the PFS is below or is projected to fall below the revised MFL, the district shall simultaneously approve a recovery or prevention strategy or modify an existing one.

• For PFS with an adopted MFL but no recovery or prevention strategy as of July 1, 2015, when a district determines that the PFS has fallen below or is projected to fall below the adopted MFL, the district shall expeditiously approve a recovery or prevention strategy.

• Requires recovery or prevention strategies to include, at a minimum, o A prioritized list of specific projects necessary to achieve the MFL;o The capitol cost, operating cost, and measures of cost benefit for each

project;o The source and amount of financial assistance from the district for each

project.o Provisions otherwise required by law.

• By December 1, 2018, DEP, or DEP in conjunction with a district, is required, for PFS:

o To complete an assessment to determine whether the spring is impaired;o Establish a total maximum daily load (TMDL) for nutrients for PFS

determined to be impaired;

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o Establish basin management action plans (BMAPs) that include PFS that are subject to a TMDL.

• If a PFS is determined to be impaired after December 1, 2018, DEP is to establish a BMAP to include the PFS within 2 years of the determination.

• Provides that BMAPs for PFS include, at a minimum:o A priority listing of all specific projects identified for implementation of

the BMAPo The capital cost, operating cost, and measures of cost benefit for each

projecto The source and amount of financial assistance, if any, from the districts,

DEP, or DACS for each project.o Provisions otherwise required by law.

• Provides standards and a frameworks for agricultural BMPs, provisions for technical assistance, monitoring of BMP effectiveness, and reevaluation of the BMPs if water quality problems are detected.

• Requires that those engaged in agriculture within the geographic area encompassed by a BMAP that includes a PFS either implement BMPs or conduct water quality monitoring, and provides a schedule for implementation.

Section 15 – Water quality classification (lines 2235-2266)

• Amends s. 403.061, F.S., to require that DEP adopt by rule a specific surface water classification to protect surface waters used for treated potable water supply. These waters will have the same water quality criteria protections as waters designated for fish consumption, recreation, and the propagation and maintenance of a well-balanced population of fish and wildlife, and shall be free from discharged substances at a concentration that, alone or in combination with other discharged substances, would require significant alteration of permitted treatment processes at the permitted treatment facility or that would otherwise prevent compliance with applicable state drinking water standards in the treated water. The section also would allow the surface water to be reclassified as waters designated for potable water supply.Note – there is revised language to this section and section 17 of the bill, which has been agreed to by and between the AWWA, FWEA, interested landowners, DEP, and DACS, and we anticipate that the language will be incorporated in a final “water bill” should one continue to progress between the House and the Senate as session continues.

Section 16 – Development of BMAPs and TMDLs (lines 2266-2400)

• Amends s. 403.067, F.S., to require DEP to establish a working group in areas where sewage treatment and disposal systems represent a source of excess nitrate-nitrite in springs or spring systems that must be controlled to meet a TMDL. Provides for membership of the working group to include DEP, the Department of Health, relevant local governments, and relevant public and private wastewater utilities. Provides that the group is responsible for

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o Collecting and evaluating credible scientific information on the effects of nutrients, particularly forms of nitrogen, on springs and spring systems.

o Developing and implementing a public education plan to provide area residents with reliable, understandable information about onsite sewage treatment and disposal systems and springs.

o Developing projects necessary to reduce the nutrient impacts from onsite sewage treatment and disposal systems.

• Provides that DEP will award funds to implement this subparagraph contingent on a specific appropriation in the General Appropriations Act, which may include all or part of the costs associated with public education, construction of central wastewater facilities, one-time impact fees associated with property owner connection to central wastewater facilities, or the addition of effective nitrate-nitrite reducing features to existing onsite systems.

• Provides factors for consideration by the department in awarding funds for projects under this section.

Section 17 – Water quality classifications (lines 2401-2425)

• The provisions of this section are are intended to work together in conjunction with the provisions of section 15, which would require DEP to establish a new classification for surface waters used for treated potable water.

• Amends s. 403.861, Florida Statutes, to provide for a permit applicant proposing to construct a new public water system to provide potable water to the public using a surface water that, at the time of the permit application, does not include potable water supply as a designated use, to petition to reclassify the water body to include potable water supply as a designated use, or certify that the utility will provide potable water that will at least meet primary drinking water standards.

• Provides a mechanism for existing permittees to reclassify surface waters currently being used, but not designated for use, for potable drinking water, to be reclassified in accordance with the new classification to be established by DEP under section 15 of the bill.Note – there is revised language to this section and section 17 of the bill, which has been agreed to by and between the AWWA, FWEA, interested landowners, DEP, and DACS, and we anticipate that the language will be incorporated in a final “water bill” should one continue to progress between the House and the Senate as session continues.

Section 18 – Effective date – (line 2426)

• The effective date of the bill would be July 1, 2015.

Update: CS/HB 7003 was workshopped this week in the Senate Environmental Preservation & Conservation Committee. The Committee has put the Senate’s “water bill,” SB 918, on the agenda for a vote, and at that meeting, we expect that there will be an amendment that will incorporate some elements of HB 7003; possibly with changes, into the Senate bill.

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